Occidental Petroleum 2002 Annual Report Download - page 18
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SEGMENT OPERATIONS
The following discussion of Occidental's two operating segments and
corporate items should be read in conjunction with Note 15 to the Consolidated
Financial Statements.
Segment earnings exclude interest income, interest expense, unallocated
corporate expenses, discontinued operations and cumulative effect of changes in
accounting principles, but include gains and losses from dispositions of segment
assets and results from equity investments.
Foreign income and other taxes and certain state taxes are included in
segment earnings based on their operating results. U.S. federal income taxes are
not allocated to segments except for amounts in lieu thereof that represent the
tax effect of operating charges resulting from purchase accounting adjustments,
and the tax effects resulting from major, infrequently occurring transactions,
such as asset dispositions and legal settlements that relate to segment results.
The following table sets forth the sales and earnings of each operating
segment and corporate items:
SEGMENT OPERATIONS
In millions
For the years ended December 31, 2002 2001 2000
================================ ======== ======== ========
SALES
Oil and Gas $ 4,634 $ 5,134 $ 4,875
Chemical 2,704 2,968 3,629
-------- -------- --------
$ 7,338 $ 8,102 $ 8,504
================================ ======== ======== ========
EARNINGS(LOSS)
Oil and Gas (a) $ 1,707 $ 2,845 $ 2,417
Chemical (a) 275 (399) 141
-------- -------- --------
1,982 2,446 2,558
Unallocated corporate items
Interest expense, net (b) (253) (272) (372)
Income taxes (c) (364) (359) (853)
Trust preferred distributions
and other (47) (56) (67)
Other (c, d) (155) (580) 291
-------- -------- --------
Income from continuing
operations 1,163 1,179 1,557
Discontinued operations, net (79) (1) 13
Cumulative effect of changes in
accounting principles, net (95) (24) --
-------- -------- --------
Net Income $ 989 $ 1,154 $ 1,570
================================ ======== ======== ========
(a) Segment earnings in 2002 were affected by $402 million of net credits
allocated, comprising $1 million of charges and $403 million of credits in
oil and gas and chemical, respectively. The chemical amount includes a $392
million credit for the sale of the Equistar investment. Segment earnings in
2001 were affected by $14 million of net charges allocated, comprising $56
million of charges and $42 million of credits in oil and gas and chemical,
respectively. The oil and gas amount includes a charge for the sale of the
Indonesian Tangguh LNG project. The chemical amount includes credits for
the sale of certain chemical operations. Segment earnings in 2000 were
affected by $25 million from net charges allocated, comprising $32 million
of charges and $7 million in credits in oil and gas and chemical,
respectively. The oil and gas amount includes a charge for the GOM